PHILADELPHIA--(BUSINESS WIRE)--Independence Realty Trust, Inc. (“IRT” and the “Company”) (NYSE: IRT), a multifamily apartment REIT, announces its fourth quarter and full year 2024 financial results and establishes full year 2025 guidance.

Management Commentary

“2024 was another strong year for IRT as we achieved the high-end of our guidance, with CFFO per share of $1.16 and NOI growth of 3.2%,” said Scott Schaeffer, Chairman and CEO of IRT. “This performance is a reflection of our continued focus on balancing occupancy and rental rate growth, underpinned by accomplishing strategic milestones. Looking ahead to 2025, we believe we are well-positioned to grow CFFO as we capitalize on rebounding market fundamentals to create value for shareholders.”

Fourth Quarter Highlights

• Net loss available to common shares of $1.0 million for the quarter ended December 31, 2024 compared to $40.5 million for the quarter ended December 31, 2023. Loss per diluted share of $0.00 for the quarter ended December 31, 2024 compared to $0.18 for the quarter ended December 31, 2023.
• Same-store portfolio net operating income (“NOI”) grew 5.3% for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023.
• Core Funds from Operations (“CFFO”) of $75.0 million for the quarter ended December 31, 2024 compared to $68.7 million for the quarter ended December 31, 2023. CFFO per share was $0.32 for the fourth quarter of 2024, as compared to $0.30 for the fourth quarter of 2023.
• Adjusted EBITDA of $94.5 million for the quarter ended December 31, 2024 compared to $95.6 million for the quarter ended December 31, 2023.
• Value add program completed renovations at 395 units during the quarter ended December 31, 2024, achieving a weighted average return on investment during the quarter of 15.1%.
• Increased our unsecured credit facility from $500 million to $750 million and extended the maturity under the facility, thereby strengthening our balance sheet while enhancing long-term value through lower interest expense.

Full Year Highlights

• Net income available to common shares of $39.3 million for the year ended December 31, 2024 compared to net loss available to common shares of $17.2 million for the year ended December 31, 2023. Earnings per diluted share of $0.17 for the year ended December 31, 2024 compared to loss per diluted share of $0.08 for the year ended December 31, 2023.
• Same-store portfolio NOI grew 3.2% for the year ended December 31, 2024 compared to the year ended December 31, 2023.
• CFFO of $266.9 million for the year ended December 31, 2024 compared to $263.9 million for the year ended December 31, 2023. CFFO per share was $1.16 for the year ended December 31, 2024, as compared to $1.15 for the year ended December 31, 2023.
• Adjusted EBITDA of $350.3 million for the year ended December 31, 2024 compared to $366.8 million for the year ended December 31, 2023. The decrease was primarily driven by asset sales completed in connection with our Portfolio Optimization and Deleveraging Strategy, which also reduced net debt to Adjusted EBITDA from 6.7x for the fourth quarter of 2023 to 5.9x for the fourth quarter of 2024.
• Value add program completed renovations at 1,671 units during the year ended December 31, 2024, achieving a weighted average return on investment of 15.7%.

2025 Guidance Highlights

• Earnings per diluted share of $0.19 to $0.22.
• CFFO per share of $1.16 to $1.19.
• 2025 same-store NOI growth of 0.8% to 3.3%.

Included later in this press release are assumptions underlying our guidance and definitions of NOI, CFFO, Adjusted EBITDA and other Non-GAAP financial measures and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP, as well as discussion of our same-store methodology.

Same-Store Portfolio⁽¹⁾ Operating Results

Operating Metrics

The table below summarizes operating metrics for the same-store portfolio for the applicable periods.

Value Add Program

We completed renovations on 395 units during the quarter ended December 31, 2024, achieving a return on investment of 15.1%, with an average cost per unit renovated of $18,368, and an average monthly rent increase per unit of $230 over unrenovated comps. We completed renovations on 1,671 units during the year ended December 31, 2024, achieving a return on investment of 15.7%, with an average cost per unit renovated of $18,294, and an average monthly rent increase per unit of $239 over unrenovated comps.

Investment Activity

Held for Sale

• As of December 31, 2024, we had one property in Birmingham, Alabama classified as held for sale. We recognized a loss on impairment of $21.0 million during the quarter ended December 31, 2024. We expect the sale to close in February 2025 for gross sales proceeds of $111.0 million. We intend to use the proceeds from the sale of this property to fund future property acquisitions.

Acquisitions

• Highland Ridge, Charlotte, North Carolina: On November 1, 2024, we acquired a 300-unit multifamily apartment property for $73.5 million. This acquisition expanded our footprint in Charlotte, North Carolina from 714 units to 1,014 units.
• Serenza at Ocoee Village, Orlando, Florida: On December 5, 2024, we acquired a 320-unit multifamily apartment property for $84.3 million. This acquisition expanded our footprint in Orlando, Florida from 297 units to 617 units.
• We are currently under contract to acquire a 280-unit multifamily apartment property in Indianapolis, Indiana, which is expected to expand our footprint in the Indianapolis market while providing enhanced scale and synergies. The aggregate purchase price of this property is $59.5 million, which we expect to fund using proceeds from our Birmingham sale. We expect to complete this acquisition during the first quarter of 2025. While this property is under contract, there can be no assurance that this acquisition will be consummated at expected pricing levels, within expected time frames, or at all.

Capital Expenditures

For the quarter ended December 31, 2024, recurring capital expenditures for the total portfolio were $4.2 million, or $125 per unit, value add and non-recurring expenditures for the total portfolio were $16.1 million and development expenditures for the total portfolio were $10.8 million, respectively. For the year ended December 31, 2024, recurring capital expenditures for the total portfolio were $24.9 million, or $750 per unit, value add and non-recurring expenditures for the total portfolio were $90.5 million and development expenditures for the total portfolio were $52.4 million, respectively.

Capital Markets

At-the-Market-Offering and Public Offering of Common Stock

During the second half of 2024, we entered into forward sales transactions under our previously announced ATM Program for the forward sale of an aggregate of 2,498,300 shares of our common stock. On December 30, 2024, we physically settled the forward sales transactions for the forward sale of all 2,498,300 shares at a weighted average price of $20.06 per share resulting in proceeds of $50.1 million.

In connection with our previously announced September 2024 public offering of 11,500,000 shares of common stock, we entered into a forward sale agreement with Citigroup. On December 30, 2024, we physically settled 3,250,000 of those shares at a weighted average price of $19.04, per share resulting in proceeds of $61.9 million.

The combined proceeds of $112.0 million were used to fund a portion of the purchase prices of the property acquisitions that closed during the fourth quarter 2024. As of December 31, 2024, there were 8,250,000 shares remaining under forward sale agreements, which if physically settled at the then forward price would result in additional proceeds to us of $155.8 million. We intend to use any such future proceeds for future acquisitions.

Private Placement of $150 Million of Unsecured Notes

On October 1, 2024, we received the proceeds from the previously announced $150.0 million unsecured private placement notes, and as of January 6, 2025, we had used a portion of the proceeds to repay $114.0 million of property mortgages maturing in late 2024 and early 2025, with the balance of the proceeds expected to be used to repay a $17.1 million property mortgage maturing in May 2025 and to reduce the borrowings under our unsecured revolver.

‘BBB’ Issuer Credit Rating from S&P Global Ratings

On October 30, 2024, we received a ‘BBB’ issuer credit rating and stable outlook from S&P Global Ratings. The rating is for Independence Realty Trust, Inc. and our operating partnership Independence Realty Operating Partnership L.P.

Expanded Unsecured Credit Facility, Reflecting Increased Financial Flexibility and More Favorable Capital Structure

On January 8, 2025, we entered into an amended and restated credit agreement that increased our borrowing capacity under our existing revolver from $500 million to $750 million, and extended its maturity date from January 2026 to January 2029. This transaction strengthened our balance sheet by extending our weighted average debt maturity and increasing our liquidity. It also created long-term stakeholder value through lower interest costs.

Balance Sheet and Liquidity

At December 31,2024, our net debt-to-adjusted EBITDA was 5.9x, an improvement of 0.8x as compared to December 31, 2023. As of the same date, we had unrestricted cash and cash equivalents of $21.2 million, $155.8 million remaining under forward equity sale agreements, and $305.5 million of capacity remaining on our unsecured revolver, representing total liquidity of $482.5 million. Adjusting for the January 2025 expansion of our unsecured revolver, we have liquidity of $732.5 million.

Dividend Distribution

On December 16, 2024, our Board of Directors declared a quarterly dividend of $0.16 per share of our common stock. The fourth quarter dividend was paid on January 17, 2025 to stockholders of record at the close of business on December 31, 2024.

2025 EPS, FFO and CFFO Guidance

We are introducing guidance ranges for 2025 diluted earnings per share (“EPS”), FFO and CFFO per share and same-store NOI. A reconciliation of IRT's projected EPS to FFO and CFFO per share is included below.